Question

1. Suppose that a $15,000 loan for a new car is to be by level payments at the end of each month for 5 years at a 3% effective annual rate of interest. Fill in the blanks corresponding to the first 6 months of the amortization schedule. Month Payment Interest Paid Principal paid Balance 15,000.00

Answer 1

The loan amount p = $ 15,000 Time period t= 5 years Rate of interest r3% = 3/100 = 603 Payment per year n = 12 PC * Monthly payment PMT substituting the gran values 15000 x (:03) 10.03 15000 X 12 PMT = 0.03 15000 X 0.0095 PMT = [+(1+0.0005 760]

37.5 PMT = 37.5 [1-(1.0025-60] 37.5 PHT = . [1-(0.86086) 37.5 PMT = 0.13914 PMT - 269.5127m 269.52 . Monthly payment PHT = $269.52 schedule for Calculate the amortization 6 payments 1 1. 1st payment we need calculate the Interest on principal 15000 X 0.0025 - $37.5 And paying amount = 269.52- 37.5 - $ 232.02

Balance Amount = 15000-232.00 = $14767-98 to calculate the interest 2. 2nd payment we need on balance amount 50 14767.98 80.0005 = $36.99 paging amount - 269,59-36.92- $23.2.6 balance amount = 14767.98–232.6 = $14535.38 3. 3rd payment we need to calculate the Interest on balance amount SO 14535,38%0.0025 = $36.34 paying amount = 269.52-36.34 - $233.18 balance amount = 14535.38-233.18 = $14302.2 4. 4th payment we need to calculate the Interest on balance amount 30 14300,2 %0.0095 = 35.75 paying amount = 269.52-35.75 = $933.77 balance amount = 14302.2-233.77 = $14068.43

to calculate interest S.5th payment we need on balance amount so 14068.43 x 0.0025 =35.17 paying amount = 269.50-35.17=234.35 balance amount = 14068-43-234-35 - $13834:08 we need to calculete interest 6. 6th payment on balance amount 50 13834.08 X 0.0025 = 34.58 paying amount = 269.52-34.58 =$234.au balance amount =13834-08-234.94 - $13599, 14

End of period paymund made interest principal ! outstanding principal 15000 २०१.5२ ₹ 37.5 23२.०२ 14167.98 २२69.59 136:42 122386 14535. 28 ३२69.52 ३36.34 २२33, 18 2143०२.२ के २०१.६२ है 35.75 ३२९377 214068.43 के २०१.5२ 33517 | 24.35 13834008 ३२69.52 34.58 ३२34.१५ 13599.14